Monday August 15, 2011 7:44 am

Here’s how to get free cell phone service

Yes, you can get a free cell phone with government assistance. If you make very little money, or you're part of other federal programs such as public housing, food stamps, SSI, or Medicaid, you can get a free mobile phone paid for by a fee on everyone else's phone bills.

This program has been around for years. According to the FCC, the government has been subsidizing landlines since 1984; the program, now called LifeLine, added mobile phones in 1997. LifeLine was enhanced in 2005 during the Bush administration, and TracFone's SafeLink, the first purely free LifeLine phone brand, started disbursing free phones in 2008.

“The telecoms haven't done a very good job promoting LifeLine, and the penetration rates have been dismal,” said Jose Fuentes, Tracfone's director of government relations. TracFone operates SafeLink.

LifeLine is funded by the Universal Service Fund, which you see as a surcharge on your phone bill. Established by a 1996 law, the USF makes sure that people who live in rural and low-income areas, as well as schools and libraries can get phone service. It doesn't make a distinction between wired and wireless phones; you can get a subsidy for either, but you have to choose one.

For years, phone companies used LifeLine subsidies to provide discounted service—AT&T still does—but now low-cost wireless providers can take the same subsidy and provide totally free service.

Here's how it works: LifeLine typically provides a $10 per month subsidy for low-income Americans' phone lines, Fuentes said. TracFone and Virgin Mobile are able to turn that $10 into 250 minutes. The phones themselves aren't paid for by the government; they're given away by the companies, Fuentes said.

“The misconception is that the federal government is paying for these cell phones, but all we're doing is taking the monthly discount a low income family would receive and applying it to minutes,” Fuentes said.

The government keeps track of which states have the highest Lifeline participation, meaning how many low-income residents have signed up for the service. The most enthusiastic states for free phones are Alaska, Oklahoma, Alabama, Georgia, North Carolina, and Virginia. The least LifeLine users can be found in Hawaii and Indiana.

Which Phones are Free?
There are three main free cell phone providers: TracFone's Safelink, Sprint's Assurance Wireless, and Nexus Communications' ReachOut Wireless. Other companies, such as AT&T, offer discounted service through the program but not free phones.

“You're talking about a very basic phone. Ringtones, Caller ID, and call waiting, but not a cameraphone,” Fuentes said.

SafeLink Wireless, which is part of TracFone, distributes Motorola 175, Samsung 105, and LG 320 phones. All three of these are basic bar-style phones with color screens and no cameras, and all three work on the AT&T and T-Mobile physical networks.

Assurance Wireless gives out the Kyocera Jax S1300. We reviewed the Cricket version of this phone and found it easy to use, but of mediocre quality. Assurance's phones work on the Sprint network.

ReachOut gives consumers a “random” phone from the company's inventory, according to the company's online customer service system. The phones include older, refurbished Samsung, LG, Kyocera, Motorola, Audiovox, and Nokia phones. Some are bars, some are flips, and some even appear to be cameraphones. ReachOut's coverage map appears to include most of the Sprint and Verizon networks.

All three carriers offer up to 250 minutes free per month, and text messages can be exchanged for minutes on a 1:1 basis. Safelink also offers 68- and 125-minute plans where the minutes roll over and accumulate each month. ReachOut also offers a 125-minute rollover plan.

The services all also offer options like international calling and additional minutes, but they cost extra. None of the services offer data or Web access.

How to Qualify
The three companies operate in different states. SafeLink is in 36 states, ReachOut is in 13, and Assurance is in 27. Each company's Web site lets you punch in your ZIP code to find out if you're in the right area.

Every state has slightly different requirements, so you should check on the companies' Web pages to see if you qualify. In general, you can qualify by making less than 135 percent of the federal poverty line per year, or subscribing to various other government programs.

In New York, for instance, a family of four that makes less than $30,173 per year would qualify for one phone. You'd also qualify if you're in Section 8 housing, get food stamps, home energy assistance, Medicaid, or a veteran's disability pension, among other benefits. If you receive government assistance, it's worth checking out.

This article, written by Sascha Segan, originally appeared on PCMag.com and is republished on Gear Live with the permission of Ziff Davis, Inc.